Habits for organizations and individuals

by Friesen Group on March 6, 2012

Charles Duhigg’s new book, The Power of Habit: Why We Do What We Do in Life and Business, uses case studies and stories along with descriptions of current research on habits and change to demonstrate the power of habits. Habits of individuals, successful organizations, and societies are held up as examples.

I discovered this book after reading the recent New York Times article: How Companies Learn Your Secrets. I was intrigued by the way companies use data analytics to market to consumers before the consumer knows what they want. The key is using the data to not only discover and support existing habits, but to target consumers who are at life-change-points. Change points disrupt routine, allowing the company to attempt to create new habits through marketing schemes. Perhaps scheme is too strong or too British a word, but the changed habits result in a big jump in the bottom line. For example: Target’s sales grew from $44 billion to $65 billion after they began a “heightened focus” on “specific guest segments” (p. 210).

Duhigg writes about organizations from Starbucks to the Indianapolis Colts to Saddleback church. He details how these diverse organizations make use of individual and community habits to create change and transformation. He looks at how leaders alter existing habits and create new ones through accident and design. He tells stories about leaders using change, crisis, and disruption to introduce new habits and behaviors into organizations.

My favorite case study is the story of Paul O’Neill, CEO at Alcoa. O’Neill focused on changing one habit across a multi-national organization: safety, . Through focusing on changing one habit, everything about Alcoa’s culture shifted. Priorities, goals, and ways of thinking changed. The focus on safety “created a climate in which all kinds of new ideas bubbled up” (p. 118).

There are three essential points on the neurological loop: the cue, the routine, and the reward – supported by belief. The opportunity to change happens when we identify a cue, routine, reward cycle. The simplest transformation happens when we simply change the routine we use, the center of the cycle. For example: cue – I’m tired, routine – surfing the web, reward – idea stimulation. Replace the routine with taking a walk around the office or around the block. The reward is the same, but the physical activity can offer even more rewards.

This is not a self-help book or an organizational blueprint for change. But if you are interested in case studies and stories of how habits influence organizational and individual change, I recommend this book.

What are the habits that influence your organization’s priorities and behaviors?